Chase_6615_ch11 - Andrew Chase Intermediate Accounting...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Andrew Chase Intermediate Accounting Chapter 11 Q11-1. Depreciation is the accounting process of allocating the cost of tangible assets to expense in a systematic and rational manner over the expected use of the assets, while depletion is used to describe the reduction in the cost of natural resources over a period of time, and amortization is the expiration of intangible asset over a period of time. Q11-2. The factors that are relevant in determining the annual depreciation charge are what depreciable base is to used for the asset, what is the asset’s useful life, and what method of cost apportioned is best for this asset? The factors are normally determined subjectively because no person has perfect knowledge of the future. Q11-6. Plant assets are retired because of physical factors and economic factors. Inadequacy- results when an asset ceases to be useful to a company because the demands of the firm have changed. Supersession- the replacement of one asset with another more efficient and economical asset.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 2

Chase_6615_ch11 - Andrew Chase Intermediate Accounting...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online